Driving growth through active engagement between VCs and founders

We believe active engagement between VCs and founders is essential to driving exponential growth. At an early stage, founders encounter various challenges, and VCs can bring their perspective and network to guide founders. While founders must have complete independence in managing their company’s operations, at the same time, an active engagement with VCs can help them be more efficient and effective in driving growth, managing operations, and having the right enablers to support a sustainable organization.

We focus on an active engagement model with our portfolio companies by fostering independence, open communication, providing strategic support, and problem-solving. We believe active engagement with portfolio companies is essential, and the engagement model with them needs to be customized.

Here are some of the enablers of active engagement:

1. Tailored engagement:?No two companies are the same, and hence the engagement approach needs to be different. We suggest customizing interactions based on each company’s unique context. For instance, a fintech startup may benefit from frequent strategy sessions, while a manufacturing firm might require periodic operational reviews.
2. Building trust: Building trust-based relationships is crucial. Founders are more amenable to accepting views and adhering to them when they have a trust-based relationship with VCs and believe their guidance or suggestions can be value-adding.
3. External perspective:?Bringing an external perspective can help prioritize initiatives and focus on critical areas. We have experienced that founders and their teams are quite appreciative when VCs regularly share learnings from the ecosystem; this can also help them to challenge some of the existing myths and adopt unconventional ideas and thoughts.
4. Culture building:?Active engagement is built gradually, and this needs to be ingrained in the culture of VCs and early-stage companies. In our experience, there are a few that are very helpful in building this.
5. Performance Management: We utilize Key Performance Indicators (KPIs) to measure success objectively, this can lead to transparency and reliability. We try to instill a performance-driven culture in the organization.
6. Reliability: Consistent engagement builds a culture of trust and reliability.

As part of our active engagement, there are multiple ways in which we engage with our portfolio companies; some of them are as follows:

1. Weekly stand-ups: These are a very effective way of understanding the overall performance, helping prioritize initiatives, and aligning on topics for deeper discussion. We can guide founders to adopt a data-backed approach for effective engagement and help drive outcomes.
2. Quarterly board meetings:?These are critical for analyzing performance, growth plans, and strategic initiatives, and connecting with various leadership team members, including founders. We recommend doing this in person every quarter, working closely with the founding team to shape the agenda, and using these meetings to establish personal connections.
3. Working sessions:?These can be infrequent, need-based, and leveraged to deep-dive into specific topics that are critical for the growth of the organization.
4. Townhalls:?We can leverage townhalls not only for founders to connect with their employees but if need be, investors can also share their thoughts and perspectives. These discussions can help employees understand the strategic direction of the company and increase their motivation and morale.
5. Recruitment calls: Especially for senior hires, if needed, we can also engage in discussions with prospective candidates to help them understand the longer-term vision and opportunities, thereby assisting founders in attracting top talent.
6. Networking events:?Every year, we try to organize roundtables for our portfolio companies and prospecting companies. This ensures knowledge sharing and fosters community connections.
7. Key event interventions: During critical events, like funding rounds, we can actively engage with founders and their teams to ensure they have the necessary guidance and support to prepare for the funding discussions.

Our model of active engagement empowers companies to thrive autonomously. By providing?external perspectives, building trust, and fostering a performance-driven culture, we can help in?sustainable growth and long-term success.